To protect hydropower, utilities will pay Colorado River water users to conserve

Here’s a sure sign that your region’s in drought: you stop paying your utility for the privilege of using water, and the utility starts paying you not to use water instead.

Outlandish as it sounds, that’s what four major Western utilities and the federal government are planning to do next year through the $11 million Colorado River Conservation Partnership. Under the agreement, finalized late last week between the Department of Interior and the utilities Denver Water, the Central Arizona Project, the Southern Nevada Water Authority and the Metropolitan Water District of Southern California, farmers, cities and industries will get paid to implement two-year, voluntary conservation projects that put water back into the Colorado River. The goal is to demonstrate that so-called “demand management” can prevent water levels in lakes Powell and Mead from dropping too low for their dams to generate electricity.

“We want to demonstrate how we can live within our means on the river,” said Jim Lochhead, CEO of Denver Water, whose city relies on Colorado River water piped east over the Continental Divide for about half of its water supply.

In the agricultural sphere, one candidate for funding under the partnership would be rotational fallowing agreements, where farmers band together, dry up some of their land and leave the associated water in the river in dry years. Yet after years of Western cities “buying and drying” nearby farms to lubricate their growth, agricultural groups are eager to see other non-fallowing options explored as well.

A modeling exercise completed by the Bureau of Reclamation in the summer of 2013 showed a 20 percent chance that Lake Powell could drop below &quot;minimum power pool&quot; by as early as next year, rendering Glen Canyon Dam incapable of producing electricity and potentially triggering involuntary water use reductions in the upper Colorado River Basin. Graphic courtesy of the Bureau of Reclamation.

“Fallowing is really a blunt force tool that would harm agriculture,” said Terry Frankhauser, executive vice president of the Colorado Cattlemen’s Association. “We want to try to explore other ways of reducing demand,” like switching to less water intensive crops, watering less and accepting reduced yields, or water banking—foregoing diversions when you don’t need them in exchange for the right to use more later.

In cities, projects eligible for funding could include things like water-smart landscaping, increased use of reclaimed water, or efficiency standards for appliances and new construction.

Whatever the demand-reducing mechanism, Lochhead said, “The goal is to develop a plan that we can put into place as we need to in emergency situations.” And for water managers who depend on the Colorado River, losing power-generating capacity in lakes Mead and Powell would certainly qualify as an emergency. If water levels drop that low, there likely won’t be enough head pressure in Lake Powell behind the Glen Canyon Dam to push through 7.5 million acre feet of water over 10 years. That’s how much the upper basin states—Colorado, New Mexico, Utah and Wyoming—are required to deliver to the lower basin under the 1922 Colorado River Compact. If they fall short, the lower basin states—Arizona, Nevada and California—have license to place a call on the river and force their friends in the upper basin to cut consumption.

If the turbines inside Glen Canyon Dam ground to a halt, it could prompt power prices in the upper basin to spike.

“If that happens, it would mean chaos in the basin among water users because everyone would be scrambling to try to shore up our water supplies,” Lochhead said.

And losing power generating capacity could have other consequences: proceeds from the electricity generated at Glen Canyon Dam now fund recovery programs for four endangered species—the Kanab ambersnail, the razorback sucker, the humpback chub and the southwestern willow flycatcher—that are native to the Colorado River Basin. If enough water in Lake Powell evaporates, funding for those programs could too, allowing the federal government to intervene and curtail water use in the upper basin in the name of the Endangered Species Act.

Finally, if the turbines inside Glen Canyon Dam ground to a halt, Lochhead points out that it could prompt power prices in the upper basin to spike, since roughly 5.8 million people now depend on electricity from the dam for a portion of their power supply. Exactly how much rates would rise remains unclear.

So how real is the threat of losing power at lakes Mead and Powell? The waters of both reservoirs aren’t circling the drain just yet, but the prospect of either dropping below “minimum power pool” is hardly academic: modeling completed by the Bureau of Reclamation last year suggested that if the drought and water usage trends that prevailed in the basin between 2001 and 2007 continue through the end of this decade, there’s a one-in-five chance that both Mead and Powell could drop too low to generate power by 2017.

“The consequences of that are really pretty devastating,” said Lochhead. “We need to be ahead of that curve instead of being reactionary.”

Nelson Harvey is a freelance reporter and the editor of Edible Aspen Magazine.